1. What is Realtor Commission?

Realtor commission is the fee paid to real estate agents for their services in facilitating a property sale. It's typically a percentage of the final sale price and is split between the buyer's and seller's agents.

2. How Commission is Calculated

The commission is calculated using this simple formula:

Where:

• Sale Price — The final selling price of the property
• Commission Rate — The agreed percentage rate (typically 5-6% in the US)

Example: For a $300,000 home with 5% commission, the total commission would be $15,000.

3. Typical Commission Rates

Details: While commission rates are negotiable, they typically range from 4% to 6% of the sale price in the United States. The rate may vary based on location, property type, and market conditions.

4. Using the Calculator

Tips: Enter the sale price in dollars and the commission rate as a percentage (e.g., enter 5 for 5%). The calculator will compute the total commission amount.

5. Frequently Asked Questions (FAQ)

Q1: Who pays the realtor commission?
A: Typically the seller pays the commission, which is then split between the listing agent and buyer's agent.

Q2: Is the commission rate negotiable?
A: Yes, commission rates are always negotiable between the seller and their listing agent.

Q3: How is the commission split between agents?
A: The total commission is typically split 50/50 between listing and buyer's agents, but this can vary.

Q4: Are there alternatives to percentage-based commissions?
A: Some agents offer flat-fee or tiered commission structures, especially for higher-priced homes.

Q5: When is the commission paid?
A: Commission is paid at closing from the sale proceeds, after all other closing costs are deducted.